Fraud strategy update: what the UK Government’s new approach means for businesses

The UK Government has announced a new £250 million anti-fraud strategy, marking a significant shift in how fraud is addressed across the economy. As fraud continues to account for a substantial proportion of crime in England and Wales, the strategy introduces a more proactive and preventative framework for businesses.

The strategy focuses on three key pillars – disrupt, safeguard and respond, aiming to tackle fraud at every stage, from prevention to enforcement.

A shift from enforcement to prevention

One of the most notable changes is the move away from a purely enforcement-led approach and towards one based on prevention. This places increased responsibility on businesses, financial professionals and advisers to identify and mitigate fraud risks at an earlier stage.

As we explored in our previous article, What is the UK Government’s Fraud Strategy 2026–2029 and what does it tell us?, the strategy represents a comprehensive framework aimed at disrupting criminal methods, strengthening protections and improving support for victims.

Enhanced collaboration between law enforcement, technology providers and the private sector will play a key role, alongside increased use of data sharing and artificial intelligence to detect fraud patterns.

The growing importance of KYC and internal controls

A key takeaway for businesses is the increased importance of robust compliance frameworks, particularly in relation to Know Your Customer (KYC) procedures.

As noted by Thomas Cattee, Partner and Head of the White Collar Crime team at Gherson:

“Under the new strategy, Know Your Customer (KYC) frameworks will play a key role in fraud prevention… accountants will need to update their KYC policies and onboarding procedures to ensure they remain fit for purpose, especially when used for digital identity verification and to help safeguard businesses from fraud”.

This reflects a broader expectation that businesses move beyond “tick-box” compliance and ensure that their systems are actively effective in identifying and managing risk.

Failure to prevent fraud: a key risk for businesses

The introduction of the new “failure to prevent fraud” offence (expected to have a significant impact from 2025 onwards) represents a major development for organisations.

According to Thomas Cattee:

“The introduction of the failure to prevent fraud offence in 2025 is likely to have the biggest impact… Accountants will be required to advise clients on their internal controls and assist with compliance to avoid criminal liability”.

This signals a wider regulatory shift. Rather than focusing solely on detection and enforcement, organisations are increasingly expected to take proactive steps to understand, manage and mitigate fraud risks before they arise.

What should businesses do now?

In light of these developments, businesses should consider:

• Reviewing and strengthening KYC and onboarding procedures;
• Conducting internal fraud risk assessments;
• Implementing robust internal controls and audit trails;
• Ensuring staff receive training and develop awareness of fraud prevention;
• Seeking legal advice on compliance with the “failure to prevent fraud” offence.

How Gherson can help

Gherson’s White Collar Crime team advises businesses and individuals on navigating complex regulatory frameworks, including fraud prevention, compliance and investigations.

We can assist with:

• Reviewing and enhancing compliance frameworks;
• Advising on KYC, AML and fraud prevention procedures;
• Supporting internal investigations and risk assessments;
• Advising on exposure under the “failure to prevent fraud” offence.

Read more in the original article:
What the government’s new fraud strategies mean for business | ICAEW

Gherson have many years of experience in assisting with all aspects of fraud and financial crime. If you would like to speak to us in respect of any of the issues raised in this blog or about your specific circumstances, do not hesitate to contact us for advice, send us an e-mail, or alternatively, follow us on X, Facebook, or LinkedIn to stay-up-to-date.

The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice.  Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position.  Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog.  For formal advice on the current law please do not hesitate to contact Gherson.  Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

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